Winding up order filed by Crystal Cruises owner

The owner of Crystal Cruises has filed to wind up the company after its German shipbuilding arm fell into insolvency due to the pandemic.

Genting Hong Kong, which also runs Asian brands Dream Cruises and Star Cruises, warned that it faces running out of cash by the end of the month.

In a filing with the Supreme Court of Bermuda to appoint provisional liquidators, the company disclosed that it will “imminently be unable to pay its debts as they fall due”.

Genting said: “Certain business activities of the group, including but not limited to the operations of cruise lines by Dream Cruises Holding Limited, shall continue in order to preserve and protect the core assets and maintain the value of the group; however it is anticipated that majority of the group’s existing operations will cease to operate.”

The company, which reported a record loss of $1.7 billion in May last year, completed a $2.6 billion restructuring in June 2021.

But it has been in dispute over an $88 million ‘backstop facility’ sought to address the financial crisis following its German shipyard businesses –  MV Werften and Lloyd Werft – filing for insolvency.

Genting admitted in a statement to the Hong Kong stock exchange today that it had “exhausted all reasonable efforts” to negotiate with creditors and stakeholders under its financing arrangements.

It is seeking an order from the Bermuda court to authorise liquidators to assist in developing a restructuring of the group’s financial indebtedness “in a manner designed to allow the company to continue as a going concern”.

This would involve making a “compromise or arrangement” with creditors.

Otherwise they would be “authorised to dispose of all or certain of the company’s assets with a view to maximising value and returns for creditors of the company”.

The application is expected to be heard by the court tomorrow (Thursday) at 2.30pm Bermuda time.

Trading in the group’s shares in Hong Kong continues to be suspended and a group of independent non-executive directors have resigned.

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